Many modern cryptocurrencies were born out of great technical or philosophical debates within the crypto community, or with the idea to pursue a big goal, but this was not the case with Binance Coin (or BNB). Binance created its own cryptocurrency with the intention of promoting its projects while providing benefits to BNB holders. Binance Coin was not born with its own Blockchain, but as an ERC-20 token, inserted within the Ethereum chain. The Shanghai-based company, founded by Changpeng Zhao in August 2017, generated an initial offer of 200 million BNB, which has been further reduced due to the cryptocurrency’s unique burning process. The company has later moved to Hong Kong and made its platform the world’s largest exchange. Binance Coin currently holds a place in the top 10 cryptocurrencies by market capitalization.
The central objective of Binance Coin is to be an intermediary currency in financial operations with other crypto assets. Thus, BNB would be a competition for Tether, the stablecoin currently used as the basis for most transactions on the world’s exchanges.
Binance Coin has a certain maximum offer, that is, it is not possible to issue more than a certain number of BNB coins. In its particular case, this max supply is established at 200 million BNB. However, due to the ‘coin burns’ carried out by Binance, this number is now lower and equivalent to approximately 187 million BNB. This cryptocurrency cannot be mined and instead uses a form of benefits for its holders. Thus, it works with a philosophy similar to the proof of participation.
One of the benefits is the discount system offered by BNB. Its volume depends on the time when you have obtained your BNB. In the first year, you would get a 50% discount. In the following years, the discount would decrease to 25%; 12.5% and 6.5%. A specific amount of cryptocurrency is purchased by the platform each quarter and is electronically destroyed until 50% of the total supply is purchased. This can…